Which HR Policies Do Small Charities and Businesses Need?
If you run a small charity or business, you’ve probably wondered at some point which HR policies you actually need. With so many recommended, it can be hard to know where to start and what’s legally required versus what’s just good practice.
Here’s what you need, what you should have, and what might be worth considering depending on your organisation.
Why HR policies matter
HR policies set out how your organisation handles people-related situations — from time off to disciplinaries to flexible working. They give managers and employees a clear framework to work within and help you handle issues consistently and fairly.
For small organisations, they’re particularly important. Without clear policies, decisions get made on the spot and inconsistencies creep in. That’s when disputes arise and when you’re most exposed if something goes to tribunal.
Some policies are also a legal requirement in the UK. Not having them isn’t just bad practice — it’s a compliance risk.
Which HR policies are essential for small organisations?
Let’s start with the HR policies required by law in the UK:
Disciplinary Policy
Every employer needs a disciplinary policy. It sets out the circumstances in which disciplinary action may be taken and how the process works. Employees have a right to know what’s expected of them and what happens if those expectations aren’t met. Your policy must comply with the ACAS Code of Practice on disciplinary and grievance procedures.
Grievance Policy
Employees need to know how to raise concerns. A grievance policy explains who they should approach, what steps to follow and how the organisation will handle their complaint. Again, this must follow the ACAS Code of Practice.
Health and Safety Policy
If you have five or more employees, you’re legally required to have a written health and safety policy. It should set out your approach to health and safety and the responsibilities and arrangements you have in place.
Data Protection Policy and Employee Privacy Notice
Almost every organisation holds personal data — employee records, contact details, financial information. A data protection policy sets out how this is managed in line with UK GDPR and the Data Protection Act 2018. Employees should also receive a privacy notice explaining how their personal information is collected, stored and used.
Recommended HR policies for best practice
These policies aren’t legally required but are considered good practice. Having them in place reduces risk and makes managing your team significantly easier.
Equality, Diversity and Inclusion
Under the Equality Act 2010, employers have a duty to prevent discrimination, harassment and victimisation. An EDI policy demonstrates your commitment to an inclusive workplace and supports compliance.
Holidays and Time Off Work
Even in a small team, a holiday policy prevents misunderstandings and ensures requests are handled consistently. It should cover entitlement, how to request time off and what happens with unused leave.
Performance Improvement
Performance issues are sometimes squeezed into disciplinary processes but they’re different situations and need a different approach. A performance improvement policy allows you to manage underperformance in a structured, supportive way that’s fair to the employee and protects the organisation.
Sickness and Absence
A clear absence policy sets out how you manage attendance fairly and consistently. It protects both the organisation and your employees and gives managers a framework to follow rather than making it up as they go.
Flexible Working
Since April 2024, all employees have the right to request flexible working from day one. A flexible working policy ensures requests are handled fairly, within the legal timeframe, and with a consistent process regardless of who’s asking. Further changes are expected in 2027, which will require employers to explain why a refusal is reasonable in their specific circumstances, not just cite one of the eight statutory reasons.
Bullying and Harassment
Employers can be held legally responsible for harassment in the workplace. A bullying and harassment policy defines what’s unacceptable, explains how complaints are handled and sets out the consequences.
From 30th October 2026, employers are required to take all reasonable steps to prevent workplace harassment which is a stronger standard than before. The duty now also extends to third-party harassment, meaning behaviour from clients, customers or suppliers towards your staff is in scope. An up-to-date policy is a key part of meeting this obligation.
Other policies to consider
Depending on your organisation, sector and experiences, you might also want policies covering:
Training and development, employee wellbeing, parenting leave (maternity, paternity, adoption, shared parental leave, neonatal care), code of conduct, email and internet use, social media, whistleblowing, drugs and alcohol, and working from home.
Not all of these will be relevant to every organisation. The right set of policies depends on your size, your workforce and the situations you’re most likely to face.
How to develop HR policies
Start by working out which policies you need. Use this article as a starting point, then consider your legal obligations, your team and the issues that come up most often in your organisation.
Once you know what you need, check the relevant legal requirements — employment law, statutory obligations and any applicable codes of practice. Draft each policy in plain language, making sure it’s accessible to everyone who needs to read it.
Communicate policies clearly to all employees, including new starters as part of their induction. And review them regularly. Employment law changes, and your policies need to keep up.
Getting your HR policies in place
If you need policies quickly, our HR shop has ready-to-use templates and toolkits professionally written for small businesses and charities. Easy to customise and practical to use, they give you a solid foundation without starting from scratch. Visit bluestonehr.co.uk/shop to browse what’s available.
We also offer a pack of 8 core people policies written specifically for your organisation, starting from £625 plus VAT. These are tailored to suit you and cover the policies most small organisations need to have in place.
If you’d prefer a more hands-on approach, we can help you work out which policies you need, review what you already have in place, or write policies bespoke to your organisation.
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